As life expectancy increases and healthcare costs rise, planning for continuing care has become one of the most critical—yet often overlooked—aspects of financial wellness. Whether you’re planning for yourself, aging parents, or a loved one, the need for long-term care can quickly become a financial burden if you’re not prepared.

So, what is continuing care, and how can you prepare financially? Let’s explore smart, proactive strategies that can help ensure you’re ready physically, emotionally, and financially for the road ahead.

What Is Continuing Care?

Continuing care refers to a range of services that support individuals who need assistance with daily living activities due to age, illness, or disability. This may include:

• In-home care
• Assisted living facilities
• Skilled nursing homes
• Memory care units
• Continuing Care Retirement Communities (CCRCs)

These services can be short-term after a medical event or long-term due to chronic health issues. The reality? These services aren’t cheap and they’re rarely fully covered by Medicare.

The Financial Reality of Care

According to Genworth’s 2024 Cost of Care Survey, the average cost of a private room in a Bay Area nursing home can be almost $200,000 per year, while Bay Area in-home care can cost at least $100,000 annually depending on the level of service.

Without a proper financial plan, families often find themselves forced to dip into retirement savings, liquidate investments, or rely on adult children for financial help.

The good news? There are ways to plan ahead

1. Long-Term Care Insurance (LTCI)

Long-term care insurance is one of the most direct tools available. It helps cover the cost of services that are not typically covered by health insurance, Medicare, or Medicaid.

Key considerations:

• The earlier you purchase LTC insurance, the more affordable the premiums.
• Many policies now include hybrid options that combine life insurance with long-term care benefits, offering more flexibility.
• Understand elimination periods, benefit caps, and inflation protection when comparing policies.

2. Maximize Health Savings Accounts (HSAs)

If you’re enrolled in a high-deductible health plan, an HSA offers a triple tax advantage:

• Contributions are tax-deductible
• Growth is tax-deferred
• Withdrawals for qualified medical expenses are tax-free

After age 65, HSA funds can also be used for non-medical expenses without a penalty (though subject to regular income tax). For those planning ahead, an HSA can become a powerful supplemental account to cover healthcare and care-related expenses in retirement.

3. Estate and Asset Protection Planning

For high-net-worth individuals, advanced estate planning tools like irrevocable trusts, Medicaid planning trusts, or spousal asset transfers can help protect wealth from being depleted by long-term care expenses.

It’s essential to work with a qualified estate attorney and a dedicated financial planning team to help ensure your assets are structured in a way that aligns with your long-term care preferences and eligibility for public programs if needed.

4. Retirement Income and Contingency Planning

Even with insurance, many care costs come out-of-pocket. You can gain some peace of mind for you and your family by building a retirement income strategy that includes:

• A diversified portfolio of income-producing assets
• Contingency savings for unexpected health events
• Annuities or pensions structured to provide steady income

Overall, the best time to plan for continuing care is before you need it. With rising healthcare costs and longer life spans, integrating care planning into your overall financial strategy is not just wise—it’s essential.

Let’s talk about putting the right strategies in place, so you can prepare for life’s uncertainties, while protecting what you’ve worked so hard to build.

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